Missouri Housing Development Commission has announced the new rates for 2 very successful loan programs that assist first time home buyers with obtaining down payment funds. New rates have been announced for the programs and I wanted to explain how each of the programs work so that if you are currently looking for that first home or your a realtor working with a first time home buyer you have the basic details.

The first program is the CAL program or Cash Assistance Loan - this program allows the borrower to do a first mortgage and a second mortgage the current bond issue rate on this program is at 5.625% The second mortgage is in the amount of 3% of the first loan amount but the interest rate on that is get ready 0 %, thats right I said 0 percent - and this loan has no monthly payment required as long as the first time home buyer stays in the home for 5 years you the entire second mortgage is forgiven. This will bring down the amount of what your clients have to come up with to a little over .5 percent for down payment. More details are as follows:

Qualified first-time homebuyers are eligible to receive a second mortgage of 3% of the loan amount to be used for down payment and closing costs.

The second mortgage is a five-year, diminishing loan at 0% interest

The second mortgage is forgiven after five years of occupancy by the owner and monthly payments are not required.

No junk fees are allowed. The lender may charge standard closing costs

The second program is the Non Cash Assistance and this program is for the first time home buyer who has saved their down payment but would like to get a discounted interest rate- the current rate as of today on this program is 5.125%. Program parameters as follows:

Qualified first-time homebuyers are eligible for lower interest rates than those who use the CAL program

These rates will result in a lower monthly payment

This program does not provide down payment and/or closing cost assistance

No junk fees are allowed. The lender may charge standard closing costs

There are income guidelines and property purchase guidelines as follows:

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